FOR IMMEDIATE RELEASE EXHIBIT 99.1 NATIONSBANK REPORTED 26 PERCENT INCREASE IN NET INCOME TO $788 MILLION IN THIRD QUARTER 1997 CHARLOTTE, NC, October 14, 1997 -- NationsBank third-quarter net income increased 26 percent from the year-ago quarter to $788 million, or $1.11 per common share, reflecting growth in revenue, cost containment and the benefit from recent acquisitions. "Diversified revenue streams and our disciplined attention to expense control have generated increased earnings for our company," said Hugh L. McColl Jr., chief executive officer. "We look forward to leveraging our business strengths across a customer base expanded by the addition of Montgomery Securities and the pending merger with Barnett Banks," McColl added. Net income for the first nine months of 1997 rose 30 percent to $2.26 billion, or $3.13 per common share. This compared to net income of $1.74 billion, or $2.91 per common share, in the first nine months of 1996. Excluding a merger- related charge in the first quarter of 1996, operating net income and earnings per share for the first nine months of 1996 were $1.82 billion and $3.04, respectively. Third quarter 1997 results included the benefit of several acquisitions completed in 1996 and early 1997, primarily the acquisition of Boatmen's Bancshares, Inc. on January 7, 1997. Earnings Highlights (third quarter 1997 compared to third quarter 1996 results) - ------------------- * Cash basis earnings (net income excluding amortization of intangibles) were $1.27 per common share, up 13 percent from $1.12 per share * Return on average tangible common shareholders' equity increased 840 basis points to 32.0 percent, from 23.6 percent * Noninterest income increased 38 percent to $1.22 billion driven by increases in all major categories * The cash basis efficiency ratio improved to 52.0 percent from 54.6 percent, reflecting successful integration efforts and expense containment Reported Earnings - ----------------- NationsBank earned $788 million in the third quarter of 1997. This represented a 26-percent increase over the $625 million earned in the third quarter 1996. Earnings per common share for the third quarter 1997 rose 5 percent to $1.11, from $1.06 in the year-ago quarter. Return on average common shareholders' equity was 15.9 percent in the third quarter 1997, down from 19.0 percent in the year-ago quarter, due primarily to the equity issued in the Boatmen's Bancshares, Inc. acquisition. Cash Basis Earnings - ------------------- Cash basis earnings increased 37 percent to $899 million in the third quarter of 1997, or $1.27 per common share. This compared to $658 million, or $1.12 per common share, in the third quarter 1996. The return on average tangible common shareholders' equity rose to 32.0 percent in the third quarter 1997, from 23.6 percent in the year-ago quarter. Net Interest Income - ------------------- In the third quarter of 1997, taxable-equivalent net interest income increased 24 percent to $2 billion compared to third quarter 1996. The growth was achieved through a 21-percent increase in average loans and leases and an 11- basis-point expansion in the net interest yield. The improvement in the net interest yield to 3.80 percent from 3.69 percent was primarily the result of the improved contribution of the securities portfolios and deposit expense management efforts. Noninterest Income - ------------------ Noninterest income rose 38 percent to $1.22 billion in the third quarter of 1997. This growth was attributable to higher levels of income from virtually all areas, including deposit accounts, asset management and fiduciary service fees, trading, investment banking and a gain on the sale of a credit card portfolio. Efficiency - ---------- In the third quarter of 1997, the cash basis efficiency ratio improved approximately 260 basis points to 52.0 percent, compared to 54.6 percent in the third quarter 1996. Including the amortization of intangibles, the efficiency ratio was 55.5 percent in the third quarter 1997 compared to 55.9 percent in 1996. Credit Quality - -------------- Total nonperforming assets were $1.27 billion on September 30, 1997, or .91 percent of net loans, leases and factored receivables and other real estate owned, compared to .93 percent of net levels on September 30, 1996. The allowance for credit losses totaled $2.78 billion at quarter-end, equaling 252 percent of nonperforming loans, compared to $2.32 billion, or 236 percent, one year earlier. In the third quarter of 1997, provision for credit losses was $190 million. Net charge-offs for the quarter were $199 million or .53 percent of average net loans, leases and factored receivables, compared to .44 percent in the third quarter 1996. Capital Strength - ---------------- Total shareholders' equity was $20.32 billion on September 30, 1997. This represented 8.38 percent of period-end assets, compared to 7.09 percent at September 30, 1996. Book value per common share rose 26 percent to $28.73 at the end of the third quarter 1997 from third quarter 1996. NationsBank Corporation, headquartered in Charlotte, N.C., is a bank holding company that provides financial products and services nationally and internationally to individuals, businesses, corporations, institutional investors and government agencies. NationsBank has primary retail and commercial banking operations in 16 states and the District of Columbia. As of September 30, 1997, NationsBank had total assets of $242 billion.